higher income fund remains on white list despite manager's departure
Newton Higher Income has continued its consistent performance despite the departure of lead fund manager Toby Thompson, according to Principal's White List study of income funds.
Principal believes the fund, now managed by Clive Beagles, will continue to perform well due to a star investment process rather than a star fund manager.
According to the study, Jupiter Income has slipped from its top position in January, while the Credit Suisse Income fund, managed by Bill Mott, has returned to the White List.
The White List has become an annual publication from the intermediary group and analyses the 12 best performers in the UK equity income sector. Funds included on the list are the highest performers in the sector using a combined measurement of asset growth, distributions paid and volatility over a five-year period.
The group also publishes Grey and Black lists. The Black list covers the worst 12 funds in the sector, according to Principal, while the Grey List covers the middle ground.
Royal Bank of Scotland Income remains on the White List while St James UK High Income, managed by Neil Woodford, makes its debut, along with Friends Provident Stewardship Income, managed by Ted Scott.
On the Black List, Principal highlights Framlington Extra Income and Abbey Dividend Growth, as well as the Scottish Widows Income and Norwich UK Equity Income funds. The Aegon UK Equity Income and Martin Currie IF Income are also included.
Alan Beaney, head of investments at Principal, said the past two and a half years in which value styles have outperformed growth styles should have led to a reconsideration of the place income funds inhabit in an investor's portfolio.
He added: 'The conventional view is that unit trusts promising growth are the best choice for investors aiming to build a lump sum, while income trusts are for those seeking income now.
'Our view is, and has always been, that the conventional wisdom is wrong on this point and UK equity income funds can, and should, be used by investors seeking growth as well as income.'
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